By 2015, worldwide, 1.2 billion children aged 5-14 years will have some kind of significant chronic disease. Although scientific evidence indicates that children with chronic illness have more mental health issues than their healthy peers, many controversies and gaps in the literature exist. It is imperative that an understanding of the effects of chronic illness upon the mental health status of children and adolescent be undertaken. This article uses a biopsychosocial perspective to investigate the connection between chronic illness and mental health. The intent of the article is to suggest ways that medical and mental health professionals can provide services to chronically ill children and adolescents that foster positive mental health through the achievement of all developmental tasks with as little psychological stress as possible